Schistidium liliputanum is distinguished from other species of the genus by the combination of its small size, narrowly ovate-lanceolate leaves, the often flexuose, spinulose-denticulate and long awns, and the leaf basal marginal laminal cells with transverse walls thicker than longitudinal walls. The tiny, sometimes campanulate capsules, often well hidden in the perichaetial leaves, are also useful when identifying S. liliputanum.